Pershing Gold Corp. (PGLC:NASDAQ; PGLC:TSX) announced results of phase 1 of its 2016 drill program at Relief Canyon in Nevada on Nov. 9. "Phase 1 of our 2016 Drilling Program continues to successfully extend the in-pit mineralization at Relief Canyon," stated Stephen D. Alfers, Pershing Gold's chairman, president and CEO, in the news release. "Offsets further extend to the west the high-grade zone discovered in the North Target Area in 2015."
Alfers also announced that the company had begun drilling phase 2 of the program. "Phase 2 will test targets to the south and east of the pits and has the potential for satellite discoveries that could be a source of future production at Relief Canyon's existing state-of-the-art processing facilities," he stated.
Bhakti Pavani of Euro Pacific Capital noted on Nov. 10 that "three of the eleven [phase 1] drill holes. . .have intersected high-grade intercepts. These intercepts are located within the oxide or mixed zones of the deposit and have cyanide leach gold values which indicate leachable material." She observed that "the phase 2 drill program is primarily an exploration program focused towards exploring the satellite deposits on the land package. . . it is also the Company's first drilling program that is targeted both towards development and exploration."
Heiko Ihle of Rodman and Renshaw noted in a Nov. 10 company update that some of the phase 1 holes "were drilled in an effort to test the metallurgical potential of higher-grade zones which are currently excluded from the resource estimate. Management has indicated that initial metallurgical work in these areas has proven to be promising, leading us to believe that additional ounces could be added to Relief Canyon’s resource estimate in the future."
On the phase 2 driling, Ihle stated that "the firm plans on drilling targets that have been identified during 1H16, leading us to believe that Phase 2 should be focused more on the discovery of new resources. . . given that we feel any potential discovery could be brought online in the first few years of Relief Canyon's mine life, we expect to monitor results of Phase 2 closely."
Heiko Ihle said he expected a catalyst-rich fourth quarter: "Going into the end of 2016 we expect strong news flow with respect to reaching a production decision. Most notably, we anticipate the release of a Pre-Feasibility Study (PFS) for Relief Canyon towards the end of 2016 or early 2017, at which point we expect to revisit our current model for the mine."
CEO Alfers told The Gold Report that he expects the PFS to be released in January.
BMO Global Mining, in a Nov. 11 note from its Equity Sales and Trading Desk, stated the project is "a simple open-pit, heap-leach development story in Nevada, but one that stands out vs. peers as it has a full, new, process facility and infrastructure already in place, and therefore has very low remaining capital requirements and excellent economics." The preliminary economic assessment, the BMO report noted, "outlined a robust open pit heap leach project producing ~90koz/yr at $709/oz AISC. With infrastructure / process plant already in place, capital costs are expected to be just $12-$22 Million."
Concerning permitting, the BMO report observed that "a Phase I permit modification was approved in Q3/16 and expands the permitted pit boundary and drilling areas. A Phase II permit will be submitted in late 2016. Further permit changes/updates will likely be needed (as is fairly standard in Nevada), and we see this risk as low. We note a potential change in land ownership structure from the state into private hands could de-risk the area further."
The BMO report also mentioned an upcoming Toronto Stock Exchange listing, noting, "the name is underowned in Canada and the company is now focused on improving its profile, adding research coverage, and targeting new institutional investors." Trading on the TSX commenced on Nov. 17, and according to CEO Alfers, "the Company's listing on the TSX is a keystone event that will allow us to continue to build liquidity for the Company and to diversify our strong shareholder base."
Since the TSX listing, Pershing has signed a nonbinding commitment with Sprott Resource Lending for a $20 million credit facility and today announced the closing of a public offering of common stock. "The gross proceeds to Pershing Gold from this offering is approximately $7.5 million, before deducting the underwriter's discount and other estimated offering expenses payable by the Company," Pershing announced in the release.
Read what other experts are saying about:
Want to read more Gold Report articles like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see a list of recent articles and interviews with industry analysts and commentators, visit our Streetwise Interviews page.
1) Patrice Fusillo compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. She owns, or members of her immediate household or family own, shares of the following companies mentioned in this article: None. She is, or members of her immediate household or family are, paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are sponsors of Streetwise Reports: Pershing Gold Corp. Streetwise Reports does not accept stock in exchange for its services. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their families are prohibited from making purchases and/or sales of those securities in the open market or otherwise during the up-to-four-week interval from the time of the interview or article until after it publishes.
Euro Pacific Capital Inc., Pershing Gold, Nov. 10, 2016
Euro Pacific expects to receive or intends to seek compensation for investment banking services from all companies under research coverage within the next three months. Euro Pacific or its officers, employees or affiliates may execute transactions in securities mentioned in this report that may not be consistent with the report’s conclusions.
Within the last twelve months, Euro Pacific has received compensation for investment banking services from Pershing Gold. This research contains forward looking statements made pursuant to the safe harbor provision of Private Securities Litigation Act of 1995.
Regulation Analyst Certification ("Reg AC") — Bhakti Pavani,
The views expressed in this report (which include the actual rating assigned to the company as well as the analytical substance and tone of the report) accurately reflect the personal views of the analyst(s) covering the subject securities. An analyst's sector is the universe of companies for which the analyst provides research coverage. Accordingly, the rating assigned to a particular stock represents solely the analyst's view of how that stock will perform over the next 12 months relative to the analyst's sector average.
No part of the compensation of the analyst preparing this report was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed by such analyst in this report.
Rodman & Renshaw, Pershing Gold Corporation, Nov. 10, 2016
Rodman & Renshaw is a unit of H.C. Wainwright & Co., LLC.
Investment Banking Services include, but are not limited to, acting as a manager/co-manager in the underwriting or placement of securities, acting as financial advisor, and/or providing corporate finance or capital markets-related services to a company or one of its affiliates or subsidiaries within the past 12 months.
I, Heiko F. Ihle, CFA and Jake Sekelsky , certify that 1) all of the views expressed in this report accurately reflect my personal views about any and all subject securities or issuers discussed; and 2) no part of my compensation was, is, or will be directly or indirectly related to the specific recommendation or views expressed in this research report; and 3) neither myself nor any members of my household is an officer, director or advisory board member of these companies.
None of the research analysts or the research analyst’s household has a financial interest in the securities of (including, without limitation, any option, right, warrant, future, long or short position).
As of October 31, 2016 neither the Firm nor its affiliates beneficially own 1% or more of any class of common equity securities of Pershing Gold Corporation.
Neither the research analyst nor the Firm has any material conflict of interest in of which the research analyst knows or has reason to know at the time of publication of this research report.
The research analyst principally responsible for preparation of the report does not receive compensation that is based upon any specific investment banking services or transaction but is compensated based on factors including total revenue and profitability of the Firm, a substantial portion of which is derived from investment banking services.
The Firm or its affiliates did receive compensation from Pershing Gold Corporation for investment banking services within twelve months before, and will seek compensation from the companies mentioned in this report for investment banking services within three months following publication of the research report.
The Firm does not make a market in Pershing Gold Corporation as of the date of this research report.
BMO Global Mining, Mining Specialty Sales Note, Nov. 11, 2016
This material is prepared by the BMO Capital Markets Corp. (“BMOCMC”) Equity Sales and Trading Desk. It is not a product of BMOCMC’s Research Department. Views or opinions expressed herein may differ from the views and opinions expressed by BMOCMC’s Research Department.